business.com receives compensation from some of the companies listed on this page. Advertising Disclosure
BDC Hamburger Icon

MENU

Close
BDC Logo
Search Icon
Updated Apr 24, 2024

Average Commercial Car Insurance Costs

Choose the right coverage to protect your business.

author image
Kimberlee Leonard, Senior Analyst & Expert on Business Operations
Verified CheckEditor Verified
Verified Check
Editor Verified
Close
A business.com editor verified this analysis to ensure it meets our standards for accuracy, expertise and integrity.

Table of Contents

Open row

If you or your employees use a vehicle for work, you’ll likely need a type of business insurance called commercial auto insurance. While rates vary, the average policy costs around $150 to $175 per month. Of course, your costs will depend on various factors, some that you can control and others that you can’t. We’ll dive deeper into the average commercial auto insurance costs you can expect to pay for your work vehicles.  

What is the average cost of commercial auto insurance?

According to Insureon, the 2024 national average cost of commercial car insurance is about $150 per month for both business auto and commercial customers. 

The company lists typical average monthly premiums on its site for different types of business. They reveal the following:

  • Auto services: $69
  • Media and advertising: $92
  • Wholesale: $102
  • Building design: $122
  • Nonprofits: $123
  • Real estate: $138
  • Retail: $138
  • Professional services: $139
  • Consulting: $151
  • Food & beverage: $152
  • Cleaning services: $163
  • Construction and contracting: $173
  • Landscaping: $180
  • Installation professionals: $184
  • IT and technology: $198

Another insurer, Progressive, states the average cost for commercial car insurance is $175 per month. That’s $2,100 annually.

They also list the commercial auto insurance costs for specialist types of business. The average cost paid by these SMB owners per month are:

Contractors: $172

For-hire specialty trucks: $649

For-hire transport trucks: $1,068

Tow trucks: $396

As you can see, many factors affect the average cost of commercial auto insurance, and each carrier prioritizes what it views as the most important options and coverages. 

Did You Know?Did you know
Some insurance costs are tax deductible, including commercial car insurance premiums and expenses that go beyond your deductible.

What affects your commercial auto insurance rates?

You can tell by the variation in average insurance costs that many factors affect policy pricing. Just as with choosing any type of business insurance, you have to consider many variables about your business and the vehicle you’re insuring to get an accurate quote. 

These are some variables that affect commercial auto insurance rates:

  • Location: Your location will play a significant role in insurance costs, as some states are more expensive than others.
  • Vehicle type: The commercial vehicle’s year, make and model will affect the price. Bigger, heavier vehicles typically cost more to insure than smaller, lighter ones. 
  • Miles driven: How much you drive during the policy term will also affect your rates. The more you drive, the more expensive your premium will be because you’re on the road more, thus increasing the chance of an accident. 
  • Driving record: Your driving record and your employees’ driving records will affect your rates. Better driving records are rewarded with lower rates. 
  • Industry: What you do for a living can affect your vehicle rates.
  • Number of vehicles: Having a fleet of vehicles increases your overall rates but may lower the per-vehicle rate. 

To get an accurate estimate, work with your insurance carrier on a quote that considers all pertinent details about the vehicles and drivers. 

FYIDid you know
The best liability insurance providers will rate your premium based on the driver with the worst driving record to cover the biggest risks. Consider assigning the drivers with the worst records to the least expensive vehicles.

How to keep your commercial auto insurance costs down

Commercial auto insurance is more expensive than personal car insurance. According to PolicyGenius, the average personal auto insurance policy is about $136 per month, or $1,638 annually. With such a discrepancy, many small business owners look for ways to keep costs down, since commercial auto insurance can be an expensive line item in a budget. 

Here are some tips to keep your commercial auto insurance costs down: 

  • Vet your drivers. Hire drivers with a good driving record only. Perform regular drug testing to make sure employees don’t drive under the influence, which can lead to tickets and accidents, driving up your insurance costs. 
  • Choose higher deductibles. If you choose a higher deductible on your commercial auto policy, this should lower the monthly premiums. You do need to make sure that you have sufficient funds available to cover the deductible in case of an accident.
  • Install driving trackers. Some insurance carriers will offer discounts to companies that use telematics software to track speed and unsafe driver maneuvers. These devices may also have GPS capabilities so you can see if drivers are taking unnecessary detours. Many of the best GPS fleet tracking services now feature dash cams that use AI to monitor when a driver is distracted and report incidents of unsafe driving directly back to fleet managers.
  • Get pay-as-you-drive policies. Linked to GPS tracking devices, some insurers offer programs that base their premiums on how and when your vehicles are actually used. So, for example, if you drive at statistically less risky times, you may save money.
  • Pay annually. Many insurance companies offer discounts for upfront, annual payments of the entire premium instead of monthly payments.
  • Find a cheaper home base. Since rates are influenced by location, you can save money if you base your commercial vehicles out of a less expensive area. This might not be feasible for some businesses, such as a restaurant doing deliveries, but if possible, move your fleet to a lower-priced location.
  • Limit miles driven. Generally, the less you drive, the lower your insurance rates are. While you can’t eliminate mileage for work vehicles, you can reduce miles driven with GPS route planning and grouping deliveries by proximity. 
  • See about a business use policy. You may not need a commercial auto insurance policy; in some cases, a personal car insurance policy with a “business pursuits” designation will suffice. If the vehicle is seen primarily as a personal vehicle, your rates will be lower.
  • Bundle as a fleet. If you have more than one commercial vehicle, bundle them as a fleet if possible to qualify for discounted premiums. Some carriers will have a minimum number of vehicles required for a fleet, so this isn’t always an option. 
  • Ask about other business insurance bundle discounts. Some carriers will offer discounts if you’ve purchased multiple business policies through them. Just like home and auto bundles for personal insurance, you can also bundle commercial insurance policies. 
TipBottom line
You can add insurance endorsements to your commercial auto policy to protect your business further. For example, you can add employee policies and blanket policies for contractors.

What to consider besides cost when choosing commercial auto insurance

Don’t choose your commercial auto insurance policy based solely on price. While you want to get the best deal, it’s even more critical to ensure your business is protected from the various risks that come with driving commercial vehicles.

It’s essential to choose the proper coverage protections, including sufficient liability, comprehensive and collision coverage that will pay for damages to your vehicle – or replace it if needed. You’ll also want to get rental coverage so that your business activities don’t grind to a halt when your commercial vehicle is in the shop. 

Remember that the best commercial insurance isn’t always the cheapest; it’s the one that provides the most robust financial protections for you and your business and is there for you when you file an insurance claim

Bottom LineBottom line
Some of the best deals are available only through brokers. Questions to ask your insurance broker, if you choose to use one, include what experience and credentials they have in providing commercial auto insurance, whether they’ll deal with the insurer on your behalf, and how customized the policy they offer you will be.

Commercial auto insurance FAQ

Policy limits set the maximum amount that your insurance policy will pay out in a claim related to an accident. The higher your policy limit, the more it costs your insurer, and this will push up your premiums.
The type of vehicle you insure affects how much your commercial auto insurance will cost. Passenger cars and light trucks you use for business trips or deliveries have less repair costs and attract lower premiums. Heavy trucks and specialized vehicles like cement mixers have higher repair costs, which pushes up how much you’ll pay. Buses have even higher premiums because your insurer may have to pay for multiple passenger injuries on top of vehicle repair costs if there’s an accident.
The more your vehicles are out on the road, the more expensive your insurance will be. You’ll also pay higher premiums if the types of vehicle you use cost more to repair. So, for example, a real estate agent will pay less than a hauler because they’re less likely to have insurance claims and any they do make will not be as expensive.
Your commercial auto insurance policy will cover you only for what you’ve agreed. In most cases, that’s likely to be vehicle repair costs; damage by fire, theft and vandalism; personal injury costs; and property damage costs. If you want roadside assistance or a replacement vehicle when, for example, a car is in for service, you may have to pay extra for those coverages.

Mark Fairlie contributed to this article.

author image
Kimberlee Leonard, Senior Analyst & Expert on Business Operations
Kimberlee Leonard is an insurance expert who guides business owners through the complicated world of business insurance. A former State Farm agency owner herself, Leonard started her decades-long career as a financial consultant advising on investment strategies before switching her focus to insurance and risk mitigation for businesses. Leonard has developed insurance primers on everything from small business insurance costs to specific policies, such as excess liability insurance. She has also reviewed business software tools, analyzed employee retirement plan providers and continues to share insights on financial topics as they relate to business. Leonard's work has been published in Forbes, U.S. News and World Report, Fortune, Newsweek and other respected outlets.
BDC Logo

Get Weekly 5-Minute Business Advice

B. newsletter is your digest of bite-sized news, thought & brand leadership, and entertainment. All in one email.

Back to top